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Future of Gibraltar at stake in Brexit negotiations

The EU has
put the future of Gibraltar at stake in the coming Brexit negotiations, in
effect backing Spain in its centuries-old dispute with the UK over the British
overseas territory.

After
lobbying from Spanish diplomats, the EU’s opening negotiating position for the
Brexit talks presents the British government with the choice of reaching
agreement with the Spaniards about Gibraltar’s future, or exposing its citizens
to economic peril by pushing “the rock” outside any EU-UK trade deal.

“The union
will stick up for its members, and that means Spain now,” a senior EU official
said.

Residents of Gibraltar, which Spain has sought to reclaim almost since it
was ceded to Britain in 1713, voted 96% to remain in the EU.

The
announcement came towards the end of a nine-page draft document sent by the
European council president, Donald Tusk, to member states on Friday outlining
negotiating guidelines for the upcoming Brexit talks.

The
guidelines, which will be refined at a summit of EU27 leaders at the end of
April, ruled out talks on Britain’s future relations with the EU until
“sufficient progress” had been made on agreeing the UK’s exit bill, securing
citizens’ rights and dealing with Ireland’s border.

The draft
document also said no future trade pact could be concluded before Britain had
left the bloc, insisted existing EU regulations – including the jurisdiction of
the European court of justice – must apply during any transition deal, and
rejected sector-by-sector deals, saying they undermined the integrity of the
single market.

The surprise
clause gives Spain the ability to exclude Gibraltar from any UK-EU transitional
single market access arrangement or future trade deal if it is not satisfied
with the status of the territory.

It says that
once the UK leaves the bloc “no agreement between the EU and the United Kingdom
may apply to the territory of Gibraltar without the agreement between the
Kingdom of Spain and the United Kingdom”.

This
suggests that unless Britain is willing to let its citizens on “the rock” be
subject to an inferior economic future than those in the UK, the EU has in
effect handed the Spanish government a veto on Britain’s entire future
relationship with the bloc.

A senior UK
source with knowledge of EU negotiations said the clause was extraordinary
because it effectively signalled a lack of total British sovereignty over
Gibraltar.

It gives Spain a greater say over the future of Gibraltar than the
British government is likely to be willing to accept, the source said.

Another
senior UK source with knowledge of both the EU and Whitehall said the
government was not surprised to see the reference to Gibraltar in the document
because it would have been a key demand from Spain, but suggested it was
ominous regarding what was to come.

The
Gibraltar government said it had been “shamefully singled out” for unfavourable
treatment by the European council at the behest of Spain.

“This
unnecessary, unjustified and unacceptable discriminatory proposed singling out
of Gibraltar and its people was the predictable machination of Spain that the
people of Gibraltar foresaw and one of the reasons why we voted so massively to
remain in the EU,” the chief minister, Fabian Picardo, said.

“This is a
disgraceful attempt by Spain to manipulate the European council for its own,
narrow political interests.

Brexit is already complicated enough without Spain
trying to complicate it further.”

Gibraltar’s
MEP, Clare Moody, claimed Theresa May’s failure to mention Gibraltar in her
article 50 letter, notifying the EU of the UK’s intention to leave, had
emboldened the Spanish and signalled that London was not affording the
territory the same importance in Brexit talks as Scotland and Northern Ireland.

Moody, who
has represented Gibraltar in the European parliament since 2014, said: “It is
appalling, and an example of the carelessness with which the government are
handling these negotiations overall.”

In London,
the Conservative MP Bob Neill said: “Gibraltar’s friends in the UK will be
watching this very carefully.

There will be no sellout.”

Andrew
Rosindell, the vice-chair of the all-party parliamentary group for Gibraltar,
said: “An agreement without including Gibraltar means there can be no
agreement.

British people must and will stand together, we cannot be bullied by
Spain.”

On the
Spanish side, Esteban González Pons, the vice-chair of the European People’s
party, told El País newspaper that May’s failure to mention Gibraltar in the
letter on Wednesday was “very relevant”, adding that the omission was “because
Gibraltar isn’t part of the United Kingdom; it’s a colony like the island of St
Helena”.

Sources in
the his party close to the Spanish government also told the paper: “This
absence is a good sign because it heralds good news – that Gibraltar is an
issue to be negotiated bilaterally in the future, only between Spain and the
UK.”

British
government sources pointed towards May’s comments in the House of Commons on
Wednesday, when she said the UK was “absolutely steadfast in our support of
Gibraltar, its people and its economy”.

The prime
minister said: “We have been firm in our commitment never to enter arrangements
under which the people of Gibraltar would pass under the sovereignty of another
state against their wishes, nor to enter into a process of sovereignty
negotiations with which Gibraltar is not content.”

The article
50 letter was “a notification in relation to our withdrawing from the European
Union”, May said.

“Gibraltar is not a separate member of the EU, nor is it a
part of the UK for the purposes of EU law, but we are clear that it is covered
by our exit negotiations.”

While Spain
has long sought sovereignty, or at least co-sovereignty over Gibraltar, its
more realistic aims will be to rid the territory of an airport and to ensure it
is unable to maintain its 10% corporate tax rate.

Tim Farron,
the Liberal Democrat leader, claimed May had made a “major strategic error” by
not mentioning Gibraltar in her article 50 letter. “Gibraltar should not be
hung out to dry by this government for the sake of a hard Brexit.”

A senior EU
official said the remaining 27 member states expected the stipulation to remain
in place when talks between the UK and the EU started at the end of May or
early June.

“The text
means what it says,” the official said.

“Any extension of the deal [after
withdrawal] to Gibraltar, which is a disputed territory, will require the
support of Spain. Spain must approve the applicability of a future agreement to
territory of Gibraltar.

It recognises that there are two parties to this
dispute.”

He added of
the EU’s position on Gibraltar: “There is a difference.

After Brexit is
notified there is a union of 27 and only one side of that argument is
represented.”

The day
after Britain’s Brexit vote, Spain’s then foreign minister, José Manuel García
Margallo, said the outcome had hastened the day when the Spanish flag would fly
over the territory.

Although
Margallo’s replacement, the Brussels veteran Alfonso Dastis, has softened
Spain’s tone, the issue has remained firmly on the negotiating agenda.

Spanish
MEPs and diplomats are said to have been thrilled that May made no mention of
Gibraltar in her article 50 letter.

On
Wednesday, Gibraltar’s chief minister had insisted the government would
fiercely oppose any Spanish moves to use Brexit negotiations as a means to gain
more control over the territory.

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